Texas has enacted Senate Bill 1498, a new bipartisan law granting law enforcement the authority to seize digital assets connected to criminal activity. Signed into law on June 20, the measure will go into effect on September 1.
Under SB1498, law enforcement can confiscate digital assets such as Bitcoin, NFTs, stablecoins, and other cryptocurrencies if they are used in or acquired through crimes like drug trafficking, fraud, theft, organized crime, or human trafficking. The state is also entitled to claim any appreciation in the value of these assets between the time of acquisition and the seizure.
Seized digital assets must be transferred to a secure, offline wallet under the control of the seizing agency or the state’s attorney. Forfeiture proceedings are to be filed in the county where the law enforcement agency is located.
SB1498 aligns digital assets with the existing civil asset forfeiture laws that apply to cash, vehicles, and real estate. Lawmakers said the legislation closes key legal gaps as cryptocurrencies become more prevalent in financial crimes.
Texas isn’t alone in updating its laws—Arizona is also moving to expand its asset forfeiture rules to include digital currencies.
SB1498 comes alongside SB21, signed into law by Governor Greg Abbott on June 22, making Texas the first U.S. state to establish a dedicated framework and allocate public funds for holding Bitcoin. This reserve, managed independently of the state’s general treasury, is designed to bolster financial stability and act as a hedge against inflation.
With the passage of SB21, Texas joins Arizona and New Hampshire as the third state to implement a Bitcoin reserve law.
